California & New Mexico Demand Enforcement of Methane Rule

SAN FRANCISCO (CN) — California and New Mexico sued Secretary of the Interior Ryan Zinke on Wednesday for delaying enforcement of a rule that cracks down on air pollution from oil and gas wells on federal land.

“Defendants’ action will adversely impact plaintiffs by increasing emissions of hazardous air pollutants and greenhouse gases, reducing royalty collections, and wasting fossil fuel resources that belong to the public,” the two states say in the federal lawsuit.

The rule was to take effect on Jan. 17, before President Donald Trump took office. It requires oil and gas well operators to upgrade equipment and start leak detection and repair programs. It prohibits release of methane gas except under special conditions, requires semiannual inspections, and changes the definition of “unavoidable losses,” so states can capture more royalties for avoidable losses of natural gas.

The waste prevention rule would generate an extra $14 million in state royalties, stop 41 billion cubic feet of natural gas from escaping into the air, and eliminate up to 180,000 tons of methane emissions and up to 267,000 tons of other air pollutants each year, according to the Department of the Interior.

On June 15, the U.S. Bureau of Land Management, a division of the Department of the Interior and the lead defendant, announced it would postpone the compliance date for that rule.

But attorneys general for California and New Mexico say the Trump administration can’t postpone a rule that was scheduled to take effect under a previous administration.

The states say they have a strong interest in preventing release of methane gas and other air pollutants that contribute to climate change. Rising sea levels, lower stream flows, and smog adversely impact their residents, the states say.

Rolling back the rule would also deprive the states of much-needed royalties that help fund public education. Since 2008, California has received $82.5 million a year in royalties from federal mineral extraction while New Mexico gained $470 million a year, according to the suit.

Release of natural gas in the air deemed “unavoidable losses” costs the states millions of dollars in lost royalties each year, the states say. New Mexico lost between $39 million and $46.6 million in royalties due to gas venting and flaring from 2010 to 2015, according to a study cited in the complaint.

The BLM leases property for oil and gas wells on millions of acres of public land in California and New Mexico, producing more than 50 million barrels of oil and more than 730 billion cubic feet of natural gas annually.

The BLM started updating its 38-year-old waste prevention regulations in 2014, upon recommendations from the Government Accountability Office and Department of the Interior’s Office of the Inspector General.

Wyoming, Montana, North Dakota and Texas, joined by two industry groups, challenged the rule after it was issued in November 2016. But on Jan. 16 a federal judge in Wyoming refused to grant an injunction to block the rule from taking effect one day later.

Nonetheless, the BLM cited that lawsuit as justification for its decision to postpone the regulations. The Administrative Procedure Act allows a federal agency to postpone the effective date of an action “pending judicial review” when it finds “that justice so requires” it.

California and New Mexico say that provision of the Administrative Procedure Act cannot apply in this situation because the rule’s effective date has already passed.

The states seek a court order nullifying the BLM’s postponement of the waste prevention rule.

The states are represented by George Torgun with California Attorney General Xavier Becerra’s office and Bill Grantham with New Mexico Attorney General Hector Balderas’ office.

In a separate lawsuit on Monday, the D.C. Circuit blocked the EPA from pausing Obama-era regulations on methane gas emissions from oil and natural gas wells.

An Interior Department representative deferred comment to the Justice Department, which declined to offer a statement Thursday morning.